xDOM Max

xDOM Max: Maximizing Bitcoin Exposure with Altcoin Shorting (xDOMM)

xDOM Max is an aggressive, fully onchain strategy designed to maximize Bitcoin (BTC) exposure while systematically shorting altcoins based on their market dominance. Unlike xDOM Balanced, which adjusts BTC allocation dynamically, this strategy maintains a 100% notional long position in BTC and shorts the top 10 altcoins in proportion to (1 - BTC dominance). Rebalanced monthly, it’s tailored for investors seeking full BTC upside potential while hedging against broader crypto market downturns through altcoin short exposure.

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Historical Performance

Metric	Value
Period	277 days
ROI	63.94%
Max Drawdown	-14.62%
Sharpe Ratio	2.00
Annualized ROI	91.82%
Valuation Currency	USD

Live Performance

Monthly Performance Breakdown

Month	PnL	Cumulative PnL
Aug 2024	-1.65%	-1.65%
Sep 2024	6.75%	4.99%
Oct 2024	11.91%	17.49%
Nov 2024	19.91%	40.88%
Dec 2024	0.30%	41.30%
Jan 2025	7.71%	52.20%
Feb 2025	-11.25%	35.07%
Mar 2025	0.59%	35.86%
Apr 2025	13.21%	53.82%
May 2025	6.58%	63.94%

Methodology

1. Data Selection

• Coins: Top 11 cryptocurrencies by market cap according to CoinMarketCap.

• Dominance: Relative dominance calculated from the combined market cap of these 11 assets.

2. Position Construction

• BTC Long Position: Maintains a constant 100% long exposure to BTC.

• Altcoin Short Basket: Shorts the top 10 altcoins (ranks 2–11), each weighted by its dominance share within the selected set.

3. Portfolio Rebalancing

• Rebalance Frequency: Conducted at the start of each month based on the latest dominance data.

• Altcoin Tiering:

  • Top Tier: Ranks 1–10

  • 2nd Tier: Ranks 11–15

  • 3rd Tier: Ranks below 15

• Retention Rule: If an existing altcoin drops into the 2nd Tier, it is retained in the portfolio.

• Replacement Rule: If an altcoin drops below the 2nd Tier, it is replaced with a new Top Tier altcoin.

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Key Features

• 100% Long BTC: Maintains full exposure to BTC at all times.

• Altcoin Shorting by Dominance: Shorts top altcoins based on (1 - BTC dominance).

• Monthly Rebalancing: Adjusts short positions monthly, BTC allocation remains constant.

• Fully Onchain & Auditable: All positions and performance are transparent.

• Aggressive BTC Focus: Designed to maximize BTC upside while hedging broader market risk.

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Why This Strategy?

• Maximized BTC Upside: Full exposure to Bitcoin with no dilution.

• Systematic Hedging: Actively reduces downside from altcoins.

• Asymmetric Setup: Exploits long-term structural divergence between BTC and alts.

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Risks

• BTC Volatility: Full exposure increases sensitivity to BTC drawdowns.

• Altcoin Rallies: Short positions may underperform during strong altcoin uptrends.

• Liquidity: Requires liquid markets for efficient monthly rebalancing.

• Smart Contract Risk: Inherent to DeFi, though audits mitigate this.